National Republican., 1887-12-08
TRE COUNTRY'S FINANCES.
AS DISCUSSED BY SECRETARY FAIR
CHILD IN HIS ANNUAL REPORT.
Strong Free Trade Doetrino-How He
would Reduce tho surpius-Duties
That should he Removed-views on
the Bond Question.


transmitted his annual message to Congress.
After treating OF receipts, expenditures,
and the sinking fund the surplus revenue
ia reached, Of which he speaks as follows:
Taxation and currency reform were the
questions which my distinguished prede.
ceeeor deemed to be Of most pressing i'm.
portsnce, and to them he devoted q large
part Of the two annual reports which he
made to the Congress. In those repor ts he
stated his honest convictions with q vigor
and boldness which, together with the ability
and fairness that he showed In the general
management Of this department, have given
him high place among stateemen and
fDanciers. find the same subjects to be
still the most important OF all those TO
which 1t ia my duty to call your attention,
and 1t is not necessary to do otherwise than
follow she general lines laid down by him
in treating them. Circumstances have
heightened the Immediate urgency OF taxa
tion reform as affecting the surplus reve-
pues Of the government. The urgency 10
so great that the question OF surplus reve-
nues demands the earnest attention OF both
the legislative and executive branches Of
the government. By surplus revenue is
meaBt the money which annually remains
In the treasury OF the United States after
the officers Of this department have col
ltcted the taxes laid on the people by the
laws Of Congress, and have paid all the
expenses and obligations OF the govern
ment except principal OF the Interest bear
Each year for twenty-five years there has
been such surplus-tbe least 2,344 ,sS2 30
in 1874; the greatest, $l45. 543,Sl0 II in
1852. The total OF this surplus for the
twenty-five years ended June 30, 1887, was
81 49l Si5,953.l2. 1t was $lO3 AL ,007 90
during the last fiscal year, which was only
about a million Of dollars less than the
greatest annual surplus (thst Of lSS4) since
the reduction OF taxation In 1888, although
the ordinary expenditures, exclusive OF 10.
terest on the public debt, were S3O,62,
1856 81 greater In 1887 than In 1884, During
the present fiscal year ending June 80, 1885,
the surplus taxation will amount to $ll3,-
000,0C0.
What shall be done with this surplus rev.
enue? 1t comes into the treasury 10 the form
Of gold coin, silver coin, gold certlflcates,sil-
yer certificates, aud United States notes.
Tie government provides, at large annual
cost, mints and bureau OF engraving aud
printing to coin and print these various
forms Of money and representatives Of
money, that there may be q sufficient cir
culating medium In the hands OF our people
toenable them to conveniently exchange
the products Of their labor among them.
selves and with 9he peoples OF the world.
IL we take into the treasury large amounts
of these circulating media in excess OF what
we pay out, there will soon not be money
enough In the hands Of the people for the
purposes OF business; serious derangement
and disaster must follow, and portion OF la
bor must cease until the very evils which this
wrong condition creates shall have worked
temporary cure by so diminishing the con-
sumption of food, clothing, fuel, and lux
uries, by the taxation Of which the revenues
Of the government are raised, that taxes do
not exceed the expenditures Of govern.
ment. This evil and this cure every one
dents by which this may be done.
1st. The purchase Of the interest bearing
debt OF the government.
I'd. Larger expenditures by government
for other purposes than the purchase of
bonds, so that they shall each year equal
the taxation Of that year.
Sd. Reduction Of the revenue from tax
alton to the amount actually required to
meet necessary expenses.
All of these expedients have in common
: the one merit Of preventing the derange'
a ment Of business which must follow hoard
4 ing or locking up in the Treasury the circu
sting media Of the people.
The Secretary, in speaking Of the PROPOSE
tiOn to purchase bonds, says that IL has the
further merit that the Interest ceases uDor
all bonds purchased by the government
but, on the other hand, the use In business
Of the money which is devoted to the pur
chase Of bonds is worth something to the
people from whom 1t is taken by taxation,
and II the value OF this use OF money In
business is greater than the amount oi
money which is saved by the cancellation
OF the government bonds, then the people
have lost by the transaction, the measure
OF loes being the difference between The
worth Of the use OF the money to them ant
the interest saved on the bonds cancelled.
The Secretary does not think that there
will be an enlargement OF government ex
peptes simply to expend money raised bI
taxation when the public veal does mo-
otherwise call for the expenditure. Every
dollar taken by taxation from the man whC
has 1t employed IN business which thu
natural wants Of the community call for
and carried into the treasury, even IL Al
once paid out again to satisfy obligations
created by law In excess OF the health,
needs Of government Is dollar used II
misemploy labor and to impoverish tn
people, and, as a sure consequence, to i'm
pose In the end the burden OF the excessive
taxation upon the labor OF the country.
Reduction Of the revenue, 1t is claimed
is the only fit remedy for the evils which
threaten this country, and this, the Secre
tary says, may be accomplished In man.
ways. One proposed is to compel de
crease Of Importation, and consequently
decrease Of revenue from customs, b.
largely increasing the rates OF duties. Thi
plan could be made to reduce the custom
revenue, but 1t would increase the people,
tsxstion far more than 1t would decreas
the revenues, and should not be adopted.
Another way is to reduce or abolish inter
nal revenue taxation. In favor OF this
the fact that IN small part Of the souther
states the internal tax on liquors and tc
bacco Is thought TO DO oppressive, and
odious to the people Of those regions; an
the further. fact that by Its reduction th
expensesof It's collection might be somt
what reduced. By Its total abolition the
might be done away with altogether. Thes
expenses, as shown by the complete and Il
ttIesting report OF the commissioner OF II
ternal revenue, which Is commended
your careful attention, amounted during tt
last fiscal year to $i,O65, l4s.S7, being thre
ard forty-hundredths per centum Of th
lection OF the revenue from customs for Ii
same year was 50, $50, ,296 10, being three an
twelve-hundredths per centum OF Ii
amount collected
The chief cause for the prejudice again'
this tax seems TO be that as there was n
such tax before tho war for the Union,
is looked upon as u remainder OF the mea
ures adopted to raise money to carry on u
war, and which ought not TO be continue
In time OF peace, and as interfering in SON
way with the natural rights of mankind
grow grain and tobacco and manufactu
therefrom spirits, cigars. enuui ana tue v
iious forms Of mercbantable tobacco. {
course, taxation OF whisky aud tobacc
trespasses no more upon the natural rgh
Of man than does the taxation of b
clothing, OF his bedding, Of every impl
ment which he uses in the Gu
tivation of his grain and tobdcc
and In the distillation or mannfa
Que tax is direct, known. fixed; the who
OF It goes into the governments treasur
the burden OF the other is Indirect aud u
known, and only portion OF 1t comes Ia